Inventory decreased by $100,000 and wages payable decreased by $50,000.What will be the net result in terms of cash flow?

Question

Quizplus · Accepted Answer

Inventory decreased by $100,000, which means that the company sold $100,000 worth of inventory, resulting in an increase in cash flow. 
Wages payable decreased by $50,000, which means that the company paid off $50,000 in wages, resulting in a decrease in cash flow. 
Therefore, the net result is an increase in cash flow of $50,000 (100,000-50,000).

Inventory Decreased by $100,000 and Wages Payable Decreased by $50,000